Six African Countries Funded to Ease Climate Adaptation

WASHINGTON, DC, November 6, 2009 (ENS) – A total of $1.1 billion in new financing will flow to six African countries to assist them in developing renewable energy and preparing for the consequences of climate change.

From solar water heaters to wind energy to development policy planning, a range of new, scalable investments were given the green light October 27 at Trustee meetings of the Climate Investment Funds in Washington. Agreed in 2008, donor countries have pledged over US$6 billion to the Climate Investment Funds.

Mozambique, Niger and Zambia will each receive up to $50-70 million in additional funding to help transform their economies through climate resilience.

Morocco and South Africa will join Egypt in receiving very low-interest loans for $150 million, $500 million, and $300 million respectively, to strengthen their investments in clean energy in support of national priorities for low carbon development.

“Climate Investment Funds’ support for Africa is coming at a critical time. Climate change has the potential to turn back the clock on hard won development gains across the continent,” said Katherine Sierra, vice president of sustainable development at the World Bank.

“CIF financing is teaching us how to work together with governments, civil society and the private sector to make truly transformational investments a reality. Each CIF dollar so far is leveraging an additional 10 dollars in private and public investments,” Sierra said.

In Africa, where access to energy is critical for economic growth and poverty alleviation, the challenge is to help countries obtain the energy they need for economic development and poverty alleviation without aggravating climate change.

South Africa will receive $500 million from the Clean Technology Fund to support its goals of generating four percent of the country’s electricity needs from renewable energy by 2013, improving energy efficiency by 12 percent by 2015, and providing one million households with solar water heating over the next five years.

In support of the government’s strategies, the financing will focus on scaling up grid-connected solar thermal power, utility-scale wind power development, solar water heaters, and demand-side energy efficiency.

“We are delighted to receive this financial support and signal of endorsement of our clean energy plans,” said Buyelwa Sonjica, South African minister of water and environmental affairs.

“Many of our citizens struggle to get access to the most basic of energy services. This plan allows us to help them move directly into a new era of energy access, based on the principle of low-carbon growth and development,” she said. “In this way, South African citizens can serve as models of a new way of life based on clean energy.”

As a result of these strategies, South Africa’s emissions would grow at a reduced rate in the short term, plateau by 2030, and decline thereafter, said Sonjica.

It is expected that the new investments will mobilize additional financing of about 1$ billion from bilateral and multilateral funders, as well as the private sector.

Morocco will receive $150 million from the Clean Technology Fund to help establish a national Energy Development Fund. This funding mechanism will serve as a central pillar of the government’s strategy to enhance energy security and pursue low-carbon growth, including a 600 percent increase in wind power and a 15 percent reduction in energy use in buildings, industry, and transport by 2020.

Morocco’s Energy Development Fund is expected to mobilize additional financing in the range of $1.5 to 2 billion to help meet the country’s goals.

Egypt will use the $300 million from the Clean Technology Fund to support the Power Sector Strategy and Greater Cairo Urban Transport Strategy. The financing, endorsed by the CTF Trust Fund Committee earlier this year, will be used to develop wind power and low carbon urban transport systems.

Mozambique, Niger and Zambia all share dramatic risks in potential loss of land, life and livelihoods as a result of climate change. They will each receive up to $50-70 million in grants and/or very low interest loans to help integrate climate risk and resilience into their core development planning.

They have been selected as pilot countries for the Strategic Climate Fund’s Pilot Program for Climate Resilience, which is still in early stages of implementation. Each country has demonstrated both the urgent need for resilience strategies and the commitment to rigorously integrate such strategies into their overall poverty reduction and development plans.

In addition to the six country plans approved by Climate Investment Fund Trustees, eight country plans and one regional plan are under preparation for December 2009.

In May, Turkey received the first Clean Technology Fund financing for its renewable energy and energy efficiency program.

The Climate Investment Funds are a unique pair of financing instruments designed to test what can be achieved towards low-carbon and climate-resilient development through financing channeled through the Multilateral Development Banks.

The two funds are the Clean Technology Fund and the Strategic Climate Fund. Both trust fund committees have equal representation from developed and developing countries.

Recognizing the imperative of climate change deliberations underway in the UN Framework Convention on Climate Change, the Climate Investment Funds were designed as an interim measure to strengthen the global knowledge base for low-carbon and climate-resilient growth solutions.

The Clean Technology Fund finances scaled up demonstration, deployment and transfer of low-carbon technologies for greenhouse gas reductions within country investment plans.

The Strategic Climate Fund finances targeted programs in developing countries to pilot new climate or sectoral approaches with scaling-up potential.